With the new record inflation recorded by the United States, stagflation could be created, defined as a mix of economic recession, high inflation and rising unemployment, an analyst said today.
Consumer prices in the northern nation reported their biggest rise in 16 years in March, causing annual inflation to spike, the Labor Department reported.
This indicator rose 1.2 percent in the third month of 2022, marked by rising food and gasoline costs, which accounted for more than half of the increase.
On the subject, Mexican economist and expert on energy issues from the Center for Economic Research and Teaching, Rodrigo Benedith, recalled that consumer prices rose 7.9 percent through February, also for a maximum of 40 years, after a record 7.5 in four decades percent in January.
In this regard, he pointed out The high inflation that the United States is currently experiencing, its negative growth rate and the negatively developing government bonds are indicators that the country could be entering an economic crisis.
In an interview published by Sputnik, Bendith pointed out that while there has been a recession due to the pandemic, the world’s largest economy, in contrast, is showing high inflation that would lead to stagflation.
He clarified that high US inflation consists of three basic elements: increases in food, housing and fuel prices, the latter being related to the economic sanctions Washington has imposed on Moscow, particularly in the energy sector.
According to the expert, these penalties will significantly reduce the import of oil, gas and energy from Russia.
The measure was partially applied because if the US pulls Russian oil off the market entirely, the economic consequences could be even more catastrophic, Benedith explained.
If the blockade is applied to Russian crude, as was the case with Venezuela and Iran, the price of a barrel could soar to more than $200, and if they decide to sanction gas, things will get worse, the economist said .
Washington’s actions against Moscow also include banning new investments in Russia’s energy sector and financing or permitting foreign companies doing energy-generation deals in the Eurasian country.
Democratic senator blames Biden for record US inflation
Senator Joe Manchin.
Democratic Sen. Joe Manchin today blamed the Joe Biden administration and the Federal Reserve for rising inflation.
According to publication The Hill, the announcement came after Labor Department data showed the parameter rose 8.5 percent over the past 12 months, a record number.
The Federal Reserve and the government had not acted quickly enough, and today’s data is evidence of the fallout being felt across the country, Manchin said in a statement.
Instead of acting boldly, our elected leaders and the Federal Reserve responded with half measures and rhetorical errors, looking for culprits. The American people deserve the truth about the crisis and what needs to be done to control it, he added.
Manchin called the data a chilling tale of how taxes are spiraling out of control as Americans’ pockets are emptied on basic goods and fuel purchases and taxes are paid.
Official figures show that food prices have increased by 8.8 percent over the past 12 months and by 1 percent in March alone, while the value of petrol has risen by 48 percent.
For The Hill, the numbers are bad news for Democrats and Biden heading into this fall’s midterm elections as Republicans use inflation to push for a leadership change.
The White House blames Russian President Vladimir Putin for the war crisis in Eastern Europe, particularly gas and energy prices, but some US politicians see it differently.
These dramatic increases in inflation were not caused by Putin, but were the result of poor decisions by the President and the Democrats who control Congress, Senator Lindsey Graham (R. South Carolina) said.
If they want prices to come down, Americans need to change leadership, said the top Republican on the Senate Budget Committee.
(Information from Latin Press)